Khwarizmi Ventures Closes $70.6M Fund to Boost Gulf Tech Startups

Mohammed Fathy

Last updated 6-05-2026

4 min

Khwarizmi Ventures secured SAR 265m first close for its second Gulf tech fund.

The new fund builds on a $70m vehicle with five exits.

Saudi Arabia raised a record $1,7bn in 2025, up 145%.

A young population, “tech-savvy” base and strong non-oil growth drive momentum.

The fund backs seed and Series A startups, offering more than cheque-writing.

Khwarizmi Ventures has taken another step in its growth story, announcing the first close of its second venture capital fund aimed at backing ambitious tech founders across the Gulf. The Riyadh-based firm confirmed that the fund secured SAR 265 million (around $70.6 million) in signed commitments in February, with support coming from leading Saudi institutions and family offices. Capital deployment is expected to begin soon.

The new vehicle builds on the firm’s first $70 million fund, launched in 2021 with a focus on enabling the “algorithms shaping the future”. Since then, Khwarizmi has become one of the more active early-stage investors in Saudi Arabia, supporting over 30 startups. Its portfolio includes names such as Calo, Eyewa, Sary, Tamara and Hala. The first fund has already recorded five exits and started distributing returns within its first five years, not a small feat in this region, where liquidity events can sometimes feel like a waiting game.

I’ve always felt that early exits, even modest ones, send a strong signal to founders sitting on the fence about launching their own ventures. It’s one thing to talk about ecosystem maturity, but when founders and investors actually see capital coming back, well… that changes the mood entirely. It gives the market proof that things are moving, not just in theory.

Khwarizmi’s leadership team includes managing partner Abdulaziz Al-Turki, alongside partners Homam Mirdawi and Arjun Chopra, working with founding partners Dr Ibrahim Almojel and Yasser Al-Qadi. The group combines backgrounds in venture capital, technology, entrepreneurship and consulting, blending local market knowledge with global networks. That mix, local depth, international reach, is increasingly seen as spot on for a region that is both ambitious and globally connected.

Timing also plays in the fund’s favour. Saudi Arabia continues to cement its position as the largest venture capital market in the MENA region. In 2025, Saudi startups raised a record $1.7 billion across 257 deals, marking a 145% year-on-year increase and the highest annual deal count in the Kingdom’s history. Those are not just nice headlines; they reflect a system gaining real traction.

The structural drivers are well documented. Around 71% of the population is under 35, creating a young, tech-savvy consumer base. Electronic payments account for 85% of total retail transactions, and the country ranked sixth globally, second among G20 nations and third in Asia, in the UN’s 2024 E-Government Development Index. Add to this a private sector contributing 51% of GDP in 2025, real GDP growth of 4.5%, and non-oil activity expanding by 4.9%, and you start to see why many investors are leaning in.

On the flip side, growth brings expectations. Founders today face more disciplined capital structures, clearer paths to profitability, and sharper scrutiny from investors. I’m not a fan of reckless expansion at any cost, so this shift towards sustainability feels healthy, even if it means tougher conversations in boardrooms.

Khwarizmi’s second fund will target seed and Series A startups in technology and tech-enabled sectors, with particular interest in fintech, consumer tech and artificial intelligence applications. Initial ticket sizes are expected to range from $1 million to $5 million, with significant reserves for follow-on investments. In practical terms, that means the firm aims to back companies from their first institutional round through growth stages, rather than leaving them halfway, a strategy that can make all the diference when markets wobble.

Beyond capital, the firm says it works closely with founders on business development, talent acquisition, fundraising and expansion within Saudi Arabia, while opening doors through its network. Portfolio companies have reportedly benefited from support in hiring key executives, securing follow-on investors and accessing diversified funding sources. In other words, it positions itself as more than just a cheque writer.

The fund is managed by Khwarizmi Capital, which is licensed by Saudi Arabia’s Capital Market Authority under licence number 23255-02.

For founders across the Gulf building technology or tech-enabled businesses, the message is clear: fresh capital is entering the market, and investors with regional roots are preparing to deploy. From where I stand, watching the MENA scene evolve over the years, it’s hard not to feel chuffed to bits seeing local firms step up with conviction. And if this momentum keeps up, the Kingdom’s ambition to become a long-term regional tech investment hub might just move from bold vision to everyday reality.

🚀 Got exciting news to share?

If you're a startup founder, VC, or PR agency with big updates—funding rounds, product launches 📢, or company milestones 🎉 — AraGeek English wants to hear from you!